CapServCo Limited Partnership

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - exemption fromprospectus and registration requirements for issuance of limited partnership units andpromissory notes to partners of accounting firm and their family trusts.

Applicable Ontario Statutory Provisions

Securities Act, R.S.O. 1990, c.S.5, as am. ss. 25, 53, 72(5) and 74(1).

WHEREAS the Canadian securities regulatory authority or regulator (the "DecisionMaker") in each of British Columbia, Alberta, Manitoba, Ontario, Nova Scotia, NewBrunswick, Prince Edward Island and Newfoundland (the "Jurisdictions") has received anapplication from CapServCo Limited Partnership (the "Applicant") for a decision pursuantto the securities legislation and securities directions of the Jurisdictions (the "Legislation")that the prospectus requirement and dealer registration requirement contained in theLegislation (respectively, the "Registration Requirement" and the "ProspectusRequirement") shall not apply to the proposed issuance from time to time by the Applicantof limited partnership units and promissory notes to certain persons;

AND WHEREAS pursuant to the Mutual Reliance Review System for ExemptiveRelief (the "System"), the Ontario Securities Commission is the principal regulator for thisApplication;

AND WHEREAS it has been represented by the Applicant to the Decision Makersthat:

1. The Applicant was formed as a limited partnership under the laws of Ontario by thefiling of a declaration of limited partnership pursuant to the Limited Partnerships Act(Ontario) on November 9, 1999 and is governed by a limited partnership agreementmade effective November 9, 1999 (the "LP Agreement").

2. The Applicant is not at present, and does not intend to become a reporting issueror the equivalent thereof under applicable Legislation.

3. The Applicant will make secured loans to Grant Thornton LLP ("GT") (the"Financing Business") and will carry on the business of providing premises,management, agency, marketing, technology, secretarial, accounting,administrative and related services and assets to GT and may exercise all powersancillary and incidental thereto (the "Services Business").

4. CapServCo Inc. (the "General Partner") is the general partner of the Applicant andJohn B.J. Garritsen is the initial limited partner. The General Partner is acorporation incorporated under the laws of the Province of Ontario and is wholly-owned by GT.

5. The General Partner will be authorized to carry on the business of the Applicant,with full power and authority to administer, manage, control and operate thebusiness of the Applicant, and will have all power and authority to do any act, takeany proceeding, make any decision and execute and deliver any instrument, deed,agreement or document necessary for or incidental to carrying out the business ofthe Applicant, for and on behalf of the Applicant.

6. GT is a limited liability partnership of chartered accountants and managementconsultants formed under the laws of the Province of Ontario and operates in BritishColumbia, Alberta, Manitoba, Ontario, Nova Scotia, New Brunswick, Prince EdwardIsland and Newfoundland. There are approximately 194 partners in GT ("GTPartners") at the present time.

7. The capital of the Applicant will be divided into two classes of units, being Class AUnits ("Class A Units") and Class B Units ("Class B Units) (a "Unit" being a ClassA Unit or a Class B Unit, as the case may be), representing capital contributionsmade by Limited Partners (as hereinafter defined). Class A Units and Class B Unitsshall have the rights and obligations (including the right to vote, and the right toallocations of income and loss and cash distributions from the Applicant) asprovided by the LP Agreement. The net income of the Applicant attributable to theFinancing Business will be distributed to the holders of Class A Units and/or theholders of Class B Units. The net income of the Applicant attributable to theServices Business will be distributed to the holders of the Class B Units only.

8. It is proposed that approximately 174 Class A Units will be initially subscribed forby Qualified Persons (as hereinafter defined) and issued by the Applicant, at anissue price of $100 per Class A Unit. From time to time, it is proposed thatadditional Class A Units will be subscribed for and issued by the Applicant.

9. It is proposed that approximately 130 Class B Units will be initially subscribed forby Qualified Persons and issued by the Applicant at an issue price of $40,000 perClass B Unit. There will be an annual opportunity for Qualified Persons to subscribefor Class B Units if they have not already done so.

10. Each Qualified Person who subscribes for a Class A Unit and/or a Class B Unit, asthe case may be, will be admitted to the Applicant as a limited partner (a "LimitedPartner") and will become bound by the terms of the LP Agreement.

11. The LP Agreement will provide that Units may be issued by the Applicant only to aperson resident in Canada for the purposes of the Income Tax Act (Canada) whois one of the following (each, a "Qualified Person"):

(i) a GT Partner;

(ii) where a GT Partner is a Professional Corporation (as hereinafter defined),to such Professional Corporation (a "PC Partner") or the sole shareholderand director of such PC Partner who would otherwise be the GT Partner (a"GT Individual"); for the purposes of this application, a ProfessionalCorporation means a corporation which is permitted under the rules ofprofessional conduct of one of the Provincial Institutes of CharteredAccountants to conduct the practice of chartered accountancy; or

(iii) a discretionary trust, the trustees of which will consist of one or more GTPartners or GT Individuals or corporations controlled by GT (a "FamilyTrust").

12. The beneficiaries of a Family Trust consist of one or more of the following: (each,an "Eligible Beneficiary"):

(i) a GT Partner;

(ii) a GT Individual;

(iii) a person who is married to a GT Partner or a GT Individual, or who lives witha GT Partner or a GT Individual in a marriage-like relationship, whichmarriage-like relationship may be between persons of the same gender (a"Spouse");

(iv) the living issue, natural or adopted, of a GT Partner, of a GT Individual or ofa Spouse;

(v) the parents or grandparents, natural or through adoption of a GT Partner, ofa GT Individual or of a Spouse;

(vi) the siblings, natural or through adoption, of a GT Partner, of a GT Individualor of a Spouse;

(vii) the nieces and nephews, natural or through adoption, of a GT Partner, of aGT Individual or of a Spouse; or

(viii) any other person who is a dependant, wholly or partially, of a GT Partner, ofa GT Individual or of a Spouse,

provided that, if a person referred to in (iii) above subsequently ceases to be aSpouse, the Family Trust may be permitted to continue to hold trust property for thebenefit of such person and/or all or any persons who initially became beneficiariesof the Family Trust by reason of their relationship to such person.

For greater clarification, a person under any of headings (iii) through (viii) above isnot a Qualified Person.

13. In order to facilitate the financing of the Applicant and GT, Qualified Persons mayfrom time to time make loans to the Applicant, and to evidence such loans, theApplicant may issue promissory notes ("LP Notes") to such Qualified Personspursuant to the terms and conditions of a note indenture.

14. Interest will be paid on the LP Notes at a floating rate calculated by reference to theprime rate announced by GT's principal bank at its main branch in Toronto fromtime to time.

15. The Applicant will be entitled at its discretion, to repay amounts owing on the LPNotes in whole at any time and in part from time to time.

16. All proceeds raised by the Applicant from the issuance of Units and LP Notes willbe loaned by the Applicant to GT or will otherwise be invested by the Applicant infurtherance of the Financing Business and the Services Business.

17. No Limited Partner may directly or indirectly sell, transfer, assign, gift, exchange,mortgage, pledge, charge (other than a mortgage, pledge or charge to a bona fidefinancial institution as security for indebtedness incurred by such Limited Partnerfor the purposes of funding such Limited Partner's subscription for Units and LPNotes) or otherwise dispose of or deal with any Unit or LP Note except for a transferof a Unit or LP Note: (i) to a Qualified Person; or (ii) to the Applicant forcancellation.

18. If a Limited Partner: (i) ceases to be a Qualified Person; (ii) purports to sell,transfer, assign, gift, exchange, mortgage, pledge, charge (other than a mortgage,pledge or charge to a bona fide financial institution as security for indebtednessincurred by such Limited Partner for the purposes of funding such Limited Partner'ssubscription for Units and LP Notes) or otherwise disposes of or encumbers ordeals with any Unit or LP Note; or (iii) ceases to be a Limited Partner in accordancewith the LP Agreement, such Limited Partner will be entitled to receive the balanceof its capital account in the Applicant.

19. A Qualified Person that ceases to be a Limited Partner will be required toimmediately surrender all Units and LP Notes held by it to the General Partner forcancellation.

20. No Eligible Beneficiary of a Family Trust other than a GT Partner, a GT Individualor a Spouse will directly or indirectly contribute money or other assets to suchFamily Trust or GT Individual, as the case may be, in order to finance thesubscription for Units or LP Notes, or will be liable for any loan or other forms offinancing obtained by the Family Trust or GT Individual, as the case may be, forthat purpose. No Eligible Beneficiary of a Family Trust other than the GT Partneror the GT Individual, as the case may be, who is a trustee of such Family Trust willbe involved in the decision to purchase Units or LP Notes.

21. Prior to issuing a Unit or an LP Note to a Qualified Person, the Applicant willprovide such Qualified Person with a copy of this Decision Document and a copyof the most recent financial statements of the Applicant.

22. Each holder of a Unit or an LP Note shall give to the Applicant an acknowledgmentof receipt of a copy of this Decision Document and an acknowledgment that theprotections of the applicable Legislation, including statutory rights of rescission anddamages and continuous disclosure will not be available in respect of the Units andthe LP Notes. Where the holder of a Unit or an LP Note is a Family Trust, suchFamily Trust shall provide an acknowledgment to the Applicant that no EligibleBeneficiary of such Family Trust, other than the GT Partner or the GT Individual,as the case may be, who is a trustee of such Family Trust or the Spouse of such GTPartner or GT Individual, as the case may be, has directly or indirectly contributedany money or other assets to such Family Trust in order to finance the subscriptionfor Units or LP Notes and that no Eligible Beneficiary of such Family Trust otherthan the GT Partner or the GT Individual, as the case may be, who is a trustee ofsuch Family Trust was involved in the decision to purchase Units or LP Notes.

23. Within 140 days of the end of each fiscal year of the Applicant, the Applicant willprovide to each holder of Units and each holder of LP Notes, a copy of the financialstatements of the Applicant for such fiscal year.

AND WHEREAS pursuant to the System, this Decision Document evidences thedecision of each Decision Maker (collectively, the "Decision");

AND WHEREAS each of the Decision Makers is satisfied that the test contained inthe Legislation that provides the Decision Makers with the jurisdiction to make the Decisionhas been met;

THE DECISION of the Decision Makers pursuant to the Legislation is that theRegistration Requirement and Prospectus Requirement shall not apply to the issuance ofUnits or LP Notes by the Applicant to Qualified Persons, provided that the first trade inUnits or LP Notes shall be a distribution under the Legislation of the Jurisdiction in whichthe trade takes place, unless otherwise exempt thereunder or unless such first trade is oneof the following:

(a) a transfer to a Qualified Person;

(b) a transfer to the Applicant for cancellation;

(c) a pledge to a financial institution as security for indebtedness incurred forthe purpose of financing the acquisition or continued ownership of Units orLP Notes provided that, such financial institution acknowledges in writingthat it shall not be permitted to further assign or transfer such Units or LPNotes so pledged, except for a transfer to the Applicant for cancellation ora transfer back to the Pledgor to terminate such pledge.

February 29th, 2000.

"J. A. Geller"     "Robert W. Davis"